If Fixed Costs Are $490,000, the Unit Selling Price Is

question 202

Multiple Choice

If fixed costs are $490,000, the unit selling price is $35, and the unit variable costs are $20, what is the break-even sales (units) if fixed costs are reduced by $40,000?

• A) 32,667 units
• B) 14,000 units
• C) 30,000 units
• D) 24,500 units

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Definitions:

Interest Payment

The payment made to a lender by a borrower for the privilege of borrowing money, typically expressed as an annual rate.

Zero-Coupon Bond

A Zero-Coupon Bond is a debt security that doesn't pay interest (a coupon) but is traded at a deep discount, rendering profit at maturity when the bond is redeemed for its full face value.

Yield To Maturity

The total return anticipated on a bond if it is held until the end of its lifetime.

Face Value

The nominal value printed on a financial instrument such as a bond or stock certificate; it is the amount paid at maturity or when the instrument is issued.